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The SAN pie EXBT is targeting.....
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IBM To Unveil Storage Network Products
By Eric Auchard
NEW YORK (Reuters) - IBM said Tuesday it would unveil plans for a new
generation of data storage products that analysts forecast could
represent the biggest chunk of new corporate technology spending in
three years.
International Business Machines Corp. (NYSE:IBM - news), the No. 2
supplier of data storage systems connected to corporate computer
systems, behind market leader EMC Corp. (NYSE:EMC - news), laid out a
multiyear strategy for its new Storage Area Network products.
SAN products allow companies to store centrally, manage and give office
workers access to key business information, which is proliferating amid
exploding Internet use and cheaper disk drive technology that allows
organizations to store more information online.
In a strategy sure to confuse industry outsiders, IBM will not only make
its new systems compatible with computers built by rivals but will also
sell them key technology building blocks on which its own storage
products will be based.
''No other company can bring together a combination of storage,
services, and servers and software to take advantage of this important
trend,'' James Vanderslice, group executive of IBM's technology business
unit, said in an interview Monday.
Across the industry, computer makers are overcoming a traditional focus
on selling storage systems that work only with their own computers.
Instead, IBM and rivals like EMC, Sun Microsystems Inc. (Nasdaq:SUNW -
news) and Hewlett-Packard Co. (NYSE:HWP - news) are eying the far bigger
potential market for SAN systems that work on both their own and rival
computer systems.
''We are competitors and partners and customers,'' Vanderslice said of
the side-by-side competition and cooperation that, at least in the
emerging stages of the market, has begun to characterize the data
storage market.
The market for external data storage (equipment not built directly into
computers themselves) is expected to grow to $21 billion in 2003, up
from $10.5 billion in 1998, according to a forecast by market research
group Dataquest.
Within four years, SANs are expected to make up 80 percent, or $16
billion a year, of the sales of such storage equipment, said Roger Cox,
a Dataquest storage market analyst.
''Spending on data storage is going to make up such a huge portion of
corporate (information technology) hardware budgets in the future,'' Cox
said. ''Upwards of 75 percent all new hardware dollars could go to
storage systems within four to five years,'' he said.
In contrast to traditional computer layouts, in which centralized data
storage is managed inside server computers or closely connected to them,
SANs are separate storage systems linked directly to office computer
users, freeing office networks and server computers to handle other
tasks.
Earlier in the decade, IBM in effect pioneered development of SAN
storage systems with ESCON, a system designed to speed the storage of
data on its S/390 line of mainframe computers.
IBM's proposed component supply arrangement builds on recent
multibillion-dollar deals it struck with rivals like computer maker Dell
Computer Corp. (Nasdaq:DELL - news), storage supplier EMC Corp. and
video game maker Nintendo Co. More component supply pacts could be inked
in coming weeks, Vanderslice said, declining to provide specifics.
By 2002, IBM estimates, 70 percent of all medium-size and large
organizations will be using SANs to manage and share the volumes of data
created as they transform themselves into e-businesses.
At a news conference to be held at the PC Expo trade show in New York
Tuesday, IBM will showcase its strategy to provide customers with
end-to-end SAN and storage systems -- providing not only the hardware
but the software and services necessary to install SANs, whether on IBM
computers or other systems.
In addition to the strategy road map, IBM said it would offer SAN
systems running on its line of Netfinity PC servers and other Windows
NT-based computers.
IBM said it would offer a means of offloading the process of making
duplicate copies of key business data from overloaded office networks by
creating direct links between storage systems and its Tivoli system
management software.
As part of its push to boost its role as a supplier of key components
and not just whole computer systems, IBM will make available SAN
technology components, such as hard disks, network switching computer
chips and faster microprocessors, to other storage equipment vendors,
even potential rivals.
Later this year, IBM said, it will unveil a new SAN-ready storage server
system based on Seascape, the computer maker's new open design that will
underlie all future IBM storage products.
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